Is a loyalty card worth it for a café? How to work it out in dirhams

What does the reward really cost?

Example: a coffee sold for 12 DH that costs you 3 DH (coffee, sugar, milk, cup, water). When you give that coffee away, what leaves your stock is 3 DH, not 12 DH. Rent, electricity and the waiter's wage are paid either way.

There is a less favourable case: if the customer would have paid for that coffee anyway, you lose the sale, so 12 DH of revenue. The true cost sits between those two limits: at best the ingredient cost, at worst the menu price. Keep both in mind so you do not fool yourself.

• Lowest cost of a reward: its ingredient cost (3 DH in the example).
• Highest cost: its menu price, if the reward replaces a purchase that would have happened (12 DH in the example).
• To find your ingredient cost: price of the pack divided by the number of servings, plus sugar, milk and the cup.

'Buy 10, get 1 free': a discount of at most 1/11

With 'buy 10, get 1 free', the customer has 11 coffees and pays for 10. The discount is 1 coffee out of 11, about 9.1% of what they consume at menu price. That is the maximum, and only on customers who complete the card.

A customer who comes three times and never returns costs you no reward at all. In ingredient terms, the example gives away 3 DH for 120 DH paid, which is 2.5%.

The longer the card, the lower the share: with N purchases for 1 free, the maximum discount is 1/(N+1). Also pick a reward that is cheap to make (coffee, tea, a simple juice) rather than a dish with expensive ingredients.

Is a loyalty card worth it: the break-even number

Start with the margin per visit: average ticket minus the ingredient cost of that ticket. In the example, a customer buys a 12 DH coffee that costs 3 DH: the margin per visit is 9 DH.

Break-even for the subscription is: subscription ÷ margin per visit. With Stampylo at MAD 149 per month, divide MAD 149 by 9 DH: the result is the number of extra visits per month that pays for the tool.

To be more precise, each extra visit also earns a stamp, so a tenth of a reward. In the example that is 0.30 DH of ingredients per visit: the net margin drops to 8.70 DH.

• Simple formula: extra visits per month = subscription ÷ margin per visit.
• Full formula: extra visits per month = (subscription + cost of rewards given to regulars who already came) ÷ net margin per visit.
• Example: 20 rewards in the month, so 20 × 3 = 60 DH of ingredients. You then need (MAD 149 + 60 DH) ÷ 8.70 DH extra visits.
• Cautious version: count those 20 rewards at menu price, 20 × 12 = 240 DH. If the card still pays in that case, it pays in every case.

Put in your own numbers

Take a sheet of paper or your phone and fill in these lines with your numbers. Ten minutes is enough.

• Menu price of the free item: ____ DH.
• Ingredient cost of that item: ____ DH.
• Average ticket: one week's till total ÷ number of tickets that week.
• Ingredient cost of the average ticket: ____ DH.
• Margin per visit = average ticket minus ingredient cost.
• Break-even = MAD 149 ÷ margin per visit. That is the number of extra visits you need each month.

What no calculation can promise

Nobody can tell you in advance how many extra visits a card will bring. We do not quote a percentage increase in sales: it depends on your neighbourhood, your prices and your customers.

The honest way is to measure. Write down your numbers before you launch the card (tickets per week, average ticket), then compare after two or three months. The break-even number tells you from the start whether the goal is realistic: a handful of visits a month, or hundreds.

Where the Stampylo dashboard helps

The dashboard shows visits, stamps, rewards given, returning customers and private ratings. A short summary email arrives every Monday.

Multiply the rewards given in the month by your ingredient cost: that is what your programme costs you in stock. Follow the number of returning customers month by month to see whether the card is doing its job.

A stamp is added only when the order is confirmed 'Ready', so the numbers match real orders, not stamps handed out by hand. Stampylo does not work out profitability for you and cannot tell which visits the card caused: you apply the formula with its numbers and your till's.

Questions